Latest news with #ChagosDeal
Daily Mail
2 days ago
- Business
- Daily Mail
£35bn! Chagos surrender deal 'will cost Britain ten times more than what the Prime Minister claimed'
The Chagos deal will cost ten times what Labour said it would – according to the Government's own figures, it was reported last night. Official documents are said to show the UK will pay some £35billion to hand the islands over to Mauritius – compared to the £3.4billion previously stated by Sir Keir Starmer. Dame Priti Patel, the Shadow Foreign Secretary, accused the Government of 'tricking' the public after the figures, seen by the Telegraph, were released under Freedom of Information laws. She told the newspaper: 'Instead of owning up to the costs, Labour have used an accountancy trick to claim the amount was only a mere £3.4billion. 'We've all known it's a terrible deal with huge costs to hard-pressed British taxpayers. But for months, ministers in public and Parliament have sought to cover up the true amounts.' Dame Priti is expected to demand a correction and apology over the 'cover-up' from the Prime Minister when MPs return from their summer break on September 1. She said the cost was almost double the entire annual policing budget or could pay for ten brand new aircraft carriers, 70 hospitals or a 5 per cent income tax cut. The deal for the British Indian Ocean Territory was branded a 'surrender' by the Conservatives, who have warned against giving up the islands which are also home to a US military base. Under the terms of the controversial agreement, the UK will cede sovereignty of the islands by the end of this year and then lease back the Diego Garcia base. Sir Keir previously claimed that this will cost £3.4billion over 99 years, but the Tories always argued it would be more like £30billion. The Prime Minister told Parliament that estimates it would cost between £9billion and £18billion were 'absolutely wide of the mark' and suggested they were too high. However, the official document, which was produced by the Government Actuary's Department, shows the cost of the deal was first estimated at £34.7billion. The document shows civil servants were first instructed to lower the cost on paper to £10billion, to account for an estimated annual inflation rate of 2.3 per cent over 99 years, the Telegraph reported. Foreign Office sources told the paper that ministers had used a 'standard' calculation for long-term government spending and denied accusations that it was part of a 'cover-up'. MPs have previously requested the document in Parliament, but ministers have refused to release it. A Government spokesman said: 'The Diego Garcia military base is essential to the security of the UK and our key allies, and to keeping British people safe. The average cost is £101million per year, and the net present value of payments is £3.4billion – this is less than 0.2 per cent of the annual defence budget. 'The deal is supported by our closest allies, including the US, Canada, Australia and Nato. 'The costs compare favourably with other international base agreements, and the UK-US base on Diego Garcia is larger, in a more strategic location and has unparalleled operational freedom.' Last night a government source said the £35billion figure was 'inaccurate and misleading'.
Telegraph
11-06-2025
- Business
- Telegraph
The world is laughing at Britain, and only Starmer hasn't noticed
So finally, Labour's policies are resulting in tax cuts, and the Laffer Curve is back in fashion. At last, people are going to keep more of their hard-earned money, a big chunk of the national debt will be paid off and, to cap it all, minimum salaries are going to be raised and VAT on food will be reduced. Yes, the people of Mauritius sure have done well out of the Chagos deal. That £30 billion windfall, all paid for by the British taxpayer, is going to be put to excellent economy-boosting use. And who can blame them for celebrating? Their government has played an absolute blinder. Of course, we could get all picky and start asking awkward questions about why the Chagos Islands should be surrendered at all, least of all to an African country more than a thousand miles across the Indian Ocean. But that would be to rain on the Mauritian parade. It's their day and their victory, and while it was against abject, third-rate opposition, we mustn't carp. There's nothing worse than a bad loser. But we are within our rights, I reckon, to ask why good things always happen to other people. What are the chances of us British being gifted £30 billion from another country, plus a brand-new territory to paint pink on maps? I'm trying to think of an equivalent. Perhaps Spain paying us to take Tenerife off its hands, and throwing in the Women's World Cup as a juicy extra? But we British are the baddies, so we must always pay for our sins. Some international court has told us exactly that, and under the Government we elected last summer, that's final. Never mind the humiliation, the terrifying security considerations and the almighty cost. And what about the Chagossians themselves, who have been treated disgracefully throughout? Oh, sod 'em. This is the Starmer way. And hunker down, because we've got at least four more years of it. Are you happy now, you Tories who preferred to stay at home last July rather than strolling to the polling station? Ever think you might have been conned by all those bright red 'Change' placards behind Sir Keir? Well, at least when Rachel Reeves breaks yet more promises and raises our taxes in her budget this autumn, and when she comes up with yet more tripe about black holes, working people, a changing world and fixing foundations, we'll know that the rest of the world is having a darn good laugh at our expense. Yes, we are the butt of a hilarious joke by a mocking Mauritian government. And we can't complain. A baddy always gets a comeuppance in the end.
Telegraph
10-06-2025
- Business
- Telegraph
Starmer's Chagos ‘surrender' will fund tax cuts for Mauritians
Sir Keir Starmer's Chagos ' surrender ' deal will fund tax cuts for Mauritians, it has emerged. The Mauritian government has said it will use almost £500 million in payments under the terms of the Chagos agreement to pay off its national debt. This will allow ministers to abolish income tax entirely for 81 per cent of employed Mauritians, and raise minimum salaries. Sir Keir has been criticised over the deal, which will cost the UK up to £30 billion over a 99-year period, including rent payments to use a joint US-UK military base on the Chagos Islands and creating a pot of development spending for Mauritius. Conservative and Reform MPs have said the 'surrender' of the islands, which have been owned by the UK since before Mauritius was granted independence in 1968, is unnecessary and expensive. The terms of the deal include rent payments of £165 million a year for the next three years for the Diego Garcia military base, which has been used for bombing runs by Britain and America in the Middle East. Mauritian leaders celebrated the deal as the ' decolonisation ' of the Chagos Islands, which lie at the centre of the Indian Ocean and are uninhabited except for military personnel. Navin Ramgoolam, the Mauritian prime minister, has now announced that the money paid by the UK will help Mauritius cut taxes, so that 81 per cent of people in the African island nation will not pay any income tax. It comes despite warnings that Britons face tax hikes in Rachel Reeves's Budget this autumn, which is now thought to contain a black hole tens of billions of pounds large. The Mauritian reforms were announced in a budget speech by Mr Ramgoolam on Wednesday, when he said that the UK's Chagos payments for the next three years would be used to help pay off the country's national debt, which has reached 90 per cent of GDP. He said that to reach a long-term debt level of 60 per cent, the government would adjust 'both the expenditure side and the revenue side of the budget', and raise the minimum salary before an employee pays income tax to £1,774 a year. That increase, of 28 per cent, will scrap income tax entirely for 44,000 people and reduce levies on all other earners. 'As a result of the measures I have introduced, 81 per cent of employees in our country will not pay any income tax,' he said, adding that he had also decided to cut VAT on some food products. After three years, British payments for the Chagos Islands will be used for a 'future fund' to 'create wealth for future generations,' Mr Ramgoolam said. Dame Priti Patel, the shadow foreign secretary, said the announcement showed that Mauritius had taken the 'feeble and pathetic' Sir Keir 'for a ride'. 'The only people benefiting from Labour's higher taxes are the people of Mauritius,' she said. 'While causing a financial black hole in Britain, whacking up our taxes and planning further tax raids, Labour's Chagos surrender deal means families in Mauritius will see their taxes cut at our expense. 'This is an insult to hard-working British people who have once again been betrayed by Keir Starmer with millions more paying more in tax.'
The Independent
23-05-2025
- Business
- The Independent
Minister defends ‘good value' Chagos deal as Badenoch says Trump ‘laughing'
A minister has said the US will be paying 'many multiples more' to operate the Diego Garcia military base than the UK will pay to lease it under the Chagos deal, as Kemi Badenoch said the agreement would leave Donald Trump 'laughing'. Armed forces minister Luke Pollard defended the deal as 'good value' but the Tory leader said the US president has got a 'great deal at the expense of the UK'. In a treaty to 'complete the process of decolonisation of Mauritius', the Government has agreed to pay at least £120 million-a-year for 99 years for control of the vital Diego Garcia base, plus hand over £1.125 billion for economic development over a 25-year period. The Government has faced questions about their estimation of the full cost. Officials said the deal amounted to an average of £101 million a year in 2025/26 prices with an overall cost of £3.4 billion a year 'using a net present value methodology'. The Tories have said the true cost of the deal could rise to more than £30 billion if inflation is at the 2% target. Mr Pollard stood firm on the figures and said the cost was 'comparable' to bases other allies lease in the region. 'So it's £3.4 billion over 99 years – that represents good value,' he told Sky News. The French pay 85 million euros a year to rent a base in Djibouti that is 'literally next door to the Chinese naval base that's leased there', he said. He argued that Diego Garcia is '15 times bigger than that French base' and the UK had secured an 'exclusion zone' around the base to protect UK and US operations. The Trump administration in Washington supported the deal, which guarantees the future of the base which is used extensively by the US armed forces. Asked why the US is not contributing to the cost of leasing back the base, he said the partner country pays much more in operational costs. 'What we are bringing to the deal is the real estate, the UK will be leasing the base and the Americans pay for the operating costs of the base – now that is many multiples more than the leasing cost,' he told Times Radio. Tory leader Mrs Badenoch said the US was benefiting at the UK's expense. 'Donald Trump is laughing at that Chagos deal,' the Conservative Party leader told BBC Breakfast. 'He's welcoming it because he's not going to have to pay very much, if anything at all. 'He's got a great deal at the expense of the UK. That's not right. It hasn't been done in our national interest. 'What I want to see is more nurses being paid well but we can't do that because we're taking a lot of terrible decisions under Keir Starmer that are weakening our country.' The total cash cost over the 99-year term of the deal will be at least £13 billion for the use of the base and the 25-year agreement to hand over money to support projects to promote the 'economic development and welfare of Mauritius'. The International Court of Justice, in an advisory opinion in 2019, said the Chagos Archipelago should be handed over. Ministers argued that the deal needed to be done because the UK would have faced legal challenges 'within weeks' which could have jeopardised the operation of the Indian Ocean base which is used by US and British forces. The UK will retain full operational control of Diego Garcia, including the electromagnetic spectrum satellite used for communications which counters hostile interference. A 24-nautical mile buffer zone will be put in place around the island where nothing can be built or placed without UK consent.
Yahoo
23-05-2025
- Business
- Yahoo
Minister defends ‘good value' Chagos deal as Badenoch says Trump ‘laughing'
A minister has said the US will be paying 'many multiples more' to operate the Diego Garcia military base than the UK will pay to lease it under the Chagos deal, as Kemi Badenoch said the agreement would leave Donald Trump 'laughing'. Armed forces minister Luke Pollard defended the deal as 'good value' but the Tory leader said the US president has got a 'great deal at the expense of the UK'. In a treaty to 'complete the process of decolonisation of Mauritius', the Government has agreed to pay at least £120 million-a-year for 99 years for control of the vital Diego Garcia base, plus hand over £1.125 billion for economic development over a 25-year period. The Government has faced questions about their estimation of the full cost. Officials said the deal amounted to an average of £101 million a year in 2025/26 prices with an overall cost of £3.4 billion a year 'using a net present value methodology'. The Tories have said the true cost of the deal could rise to more than £30 billion if inflation is at the 2% target. Mr Pollard stood firm on the figures and said the cost was 'comparable' to bases other allies lease in the region. 'So it's £3.4 billion over 99 years – that represents good value,' he told Sky News. The French pay 85 million euros a year to rent a base in Djibouti that is 'literally next door to the Chinese naval base that's leased there', he said. He argued that Diego Garcia is '15 times bigger than that French base' and the UK had secured an 'exclusion zone' around the base to protect UK and US operations. The Trump administration in Washington supported the deal, which guarantees the future of the base which is used extensively by the US armed forces. Asked why the US is not contributing to the cost of leasing back the base, he said the partner country pays much more in operational costs. 'What we are bringing to the deal is the real estate, the UK will be leasing the base and the Americans pay for the operating costs of the base – now that is many multiples more than the leasing cost,' he told Times Radio. Tory leader Mrs Badenoch said the US was benefiting at the UK's expense. 'Donald Trump is laughing at that Chagos deal,' the Conservative Party leader told BBC Breakfast. 'He's welcoming it because he's not going to have to pay very much, if anything at all. 'He's got a great deal at the expense of the UK. That's not right. It hasn't been done in our national interest. 'What I want to see is more nurses being paid well but we can't do that because we're taking a lot of terrible decisions under Keir Starmer that are weakening our country.' The total cash cost over the 99-year term of the deal will be at least £13 billion for the use of the base and the 25-year agreement to hand over money to support projects to promote the 'economic development and welfare of Mauritius'. The International Court of Justice, in an advisory opinion in 2019, said the Chagos Archipelago should be handed over. Ministers argued that the deal needed to be done because the UK would have faced legal challenges 'within weeks' which could have jeopardised the operation of the Indian Ocean base which is used by US and British forces. The UK will retain full operational control of Diego Garcia, including the electromagnetic spectrum satellite used for communications which counters hostile interference. A 24-nautical mile buffer zone will be put in place around the island where nothing can be built or placed without UK consent.
